State Tax Commission of Missouri

 

WILLIAM H. MAURER,                                )

                                                                        )

                                    Complainant,                )

                                                                        )

            v.                                                         )           Appeal Number 05-79007

                                                                        )

LISA POPE, ASSESSOR,                              )

PLATTE COUNTY, MISSOURI                    )

                                                                        )

                                    Respondent.                 )

 

DECISION AND ORDER

 

HOLDING

          The decision of the assessor, affirmed by the Board of Equalization, setting value at $70,618 (assessed value $13,417) is SUSTAINED.

ISSUE

            The issue in this case is the true market value of a townhouse.  Complainant also asserted discrimination in his appeal but said issue was waived at hearing. 

SUMMARY

The subject property is a 1,024 square foot two-story townhouse which was originally valued by the assessor at $70,618 (assessed value $13,417).  Upon appeal, the Board of Equalization affirmed said value.  Complainant appeals asserting a value of $59,091 (assessed value $11,227).  At hearing, Respondent proposed a value of $79,000 (assessed value $15,010).  An evidentiary hearing was held on April 4, 2006, in the Platte County Courthouse before senior hearing officer Luann Johnson.  Complainant appeared pro se.  Respondent appeared by counsel, John Shank, and by her appraiser, Lizette Watson.

EXHIBITS

            The following exhibits were entered into the record:

Complainant’s Exhibits

            Exhibit 1 – Notice of Change in Assessed Value (also designated as #3)

 

            Exhibit 2 – Listing of Values for Townhouse Units

            Exhibit 3A – Request for Production

            Exhibit 4 – Response to Request for Production

            Exhibit 5 – Missouri Revised Statutes, Sections 137.490 and 137.720

            Exhibit 6 – Computer Screen Printout

            Exhibit 7 - Computation of Perceived Mass Appraisal Errors

            Exhibit 8 – Additional Listing of Perceived Mass Appraisal Errors

            Exhibit 9 – Photographs of Subject and Surrounding Neighborhood

            Exhibit 10 – Taxpayer’s Opinion of Value Calculations titled “Appraisal”

Respondent’s Exhibits

            Exhibit A – Appraisal Report

FINDINGS OF FACT

            1.         Jurisdiction is proper.  Complainant timely filed his appeal from the decision of the Platte County Board of Equalization.

            2.         The subject property is a 1,024 square foot, 37 year old, two-story townhouse over a full, unfinished basement.  It contains two bedrooms and a bath and one-half.  It is in average condition for age.  It is identified as parcel number 20-6.0-24-100-013-001-013, more commonly known as 6956 Chapel Woods Lane, Platte County, Kansas City, Missouri.

            3.         Respondent’s appraiser found sales of three substantially similar townhouses in the same development, with the same floor plan, of identical age, and on the same block as the subject property.  These comparable sales sold for $80,400, $77,000, and $73,767.  All sales occurred within six months of the tax day.  No adjustments were necessary to any of the comparable sales.  Based upon these sales, Respondent’s appraiser determined a market value for the subject property of $79,000 on January 1, 2005. 

            4.         Complainant asserted that the correct value for his property, on January 1, 2005, was $59,091.  Complainant asserted that the property identified as 6962 North West Chapel Woods Lane sold for $64,000 on November 12, 2004, as confirmed by the purchaser.  He also asserted that the County had appraised 6908 North West Chapel Woods Lane at $64,266 on April 27, 2005.  Complainant used the value of $64,266 as his value for January 1, 2005 and then deducted the cost to cure a water leak in his basement.  After this adjustment, Complainant concluded that the value of his property should be $59,091 as of January 1, 2005.  Complainant presented no other market sales to support his opinion of value nor did he present any evidence to demonstrate that market would recognize a dollar for dollar decrease in value for the cost to cure the water problem.  Complainant’s evidence is not substantial and persuasive to demonstrate that his property has been overvalued at $70,618.

            5.         No evidence was presented which suggested that any new construction or property improvements occurred between January 1, 2005, and January 1, 2006.  Therefore the value determined for tax year 2005 shall also be the value determined for tax year 2006.

            6.         The true value in money for the subject property on January 1, 2005, and

January 1, 2006 is $70,618, as determined by the assessor and approved by the Board of Equalization.

CONCLUSIONS OF LAW

 

Highest and Best Use

            True value in money is the fair market value of the property on the valuation date, and is a function of its highest and best use, which is the use of the property which will produce the greatest return in the reasonably near future.  Aspenhof Corp. v. State Tax Commission, 789 S.W.2d 867, 869 (Mo. App. 1990).

            It is true that property can only be valued according to a use to which the property is readily available.  But this does not mean that in order for a specific use to be the highest and best use for calculating the property’s true value in money, that particular use must be available to anyone deciding to purchase the property. . . .A determination of the true value in money cannot reject the property’s highest and best use and value the property at a lesser economic use of the property.  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d. 341, 348-349 (Mo. 2005). 

True Value in Money

            Section 137.115, RSMo requires that property be assessed based upon its true value in money which is defined as the price a property would bring when offered for sale by one willing or desirous to sell and purchased by one who is desiring to purchase but who is not compelled to do so.  St. Joe Minerals Corp. v. State Tax Commission, 854 S.W.2d 526, 529 (Mo. App. E.D. 1993); Missouri Baptist Children’s Home v. State Tax Commission, 867 S.W.2d 510, 512 (Mo. banc 1993).  It is the fair market value of the subject property on the valuation date.  Hermel, Inc. v. State Tax Commission, 564 S.W.2d 888, 897 (Mo. banc 1978).


Taxpayer has Burden of Proof

            In Westwood Partnership v. Gogarty, 103 S.W.3d 152 (Mo. App. E.D. 2003), the court of appeals stated:

            There is no longer an automatic presumption regarding the correctness of an assessor's valuation. Section 138.431.3. This statutory change from the previous situation in which the assessor's valuation was presumed to be correct does not mean that there is now a presumption in favor of taxpayer. The taxpayer in a Commission tax appeal still bears the burden of proof and must show by a preponderance of the evidence that the property was improperly classified or valued. Industrial Development Authority of Kansas City v. State Tax Commission of Missouri, 804 S.W.2d 387, 392 (Mo. App. 1991).

            In Reeves v. Snider, 115 S.W.3d 375 (Mo. App. S.D. 2003), the court of appeals described the taxpayer's burden as follows:

            Taxpayers were the moving parties seeking affirmative relief, and as such, they bore the burden of proving the vital elements of their case, i.e., the assessments were "unlawful, unfair, improper, arbitrary or capricious.” Cupples Hesse Corp. v. State Tax Comm'n, 329 S.W.2d 696, 702 (Mo.1959); Westwood P'ship v. Gogarty, 103 S.W.3d 152, 161[8] (Mo. App. 2003); 84 C.J.S. Taxation §§710, 726. This is true regardless of the existence or non-existence of the challenged presumption. As the Supreme Court of Missouri explained, "even were we to hold that it [the presumption] has been overcome, the burden of proof on the facts and inferences would still remain on petitioner, for it is the moving party seeking affirmative relief.”  Cupples, 329 S.W.2d at 702[16].  See also 84 C.J.S. Taxation §710, which states: "Even where there is no presumption in favor of the assessor's ruling, if no evidence is offered in support of the


complaint, the reviewing board is justified in fixing the valuation complained of in the amount assessed by the assessor."
            To prevail, Taxpayers had to "present an opinion of market value and then ... present substantial and persuasive evidence that the proposed value is indicative of the market value of the subject property on tax day." Daly v. P.D. George Co., 77 S.W.3d 645, 651 (Mo. App. 2002).

Substantial and Persuasive Evidence

            Substantial evidence is that evidence which, if true, has probative force upon the issues, i.e., evidence favoring facts which are such that reasonable men may differ as to whether it established them, and from which the Commission can reasonably decide an appeal on the factual issues.  Cupples-Hesse Corporation v. State Tax Commission, 329 S.W.2d 696, 702 (Mo. 1959).

            Persuasive evidence is that evidence which has sufficient weight and probative value to convince the trier of fact.  The persuasiveness of evidence does not depend on the quantity or amount thereof but on its effect in inducing belief.  Brooks v. General Motors Assembly Division, 527 S.W.2d 50, 53 (Mo. App. 1975).

Comparable Sales Approach

            The comparable sales approach uses prices paid for similar properties in arms-length transactions and adjusts those prices to account for differences between the properties.  Comparable sales consist of evidence of sales reasonably related in time and distance and involve land comparable in character.  This approach is most appropriate when there is an active market for the type of property at issue such that sufficient data is available to make a comparative analysis.  Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341, 347-348 (Mo. 2005). (citations omitted).

Experts

            An expert’s opinion must be founded upon substantial information, not mere conjecture or speculation, and there must be a rational basis for the opinion.  Missouri Pipeline Co. v. Wilmes, 898 S.W.2d 682, 687 (Mo. App. E.D. 1995).  The state tax commission cannot ignore a lack of support in the evidence for adjustments made by the expert witnesses in the application of a particular valuation approach.  Drey v. State Tax Commission, 345 S.W.2d 228, 234-236 (Mo. 1961); Snider v. Casino Aztar/Aztar Missouri Gaming Corp., 156 S.W.3d 341, 348 (Mo. 2005).

            The testimony of an expert is to be considered like any other testimony, is to be tried by the same test, and receives just so much weight and credit as the trier of fact may deem it entitled to when viewed in connection with all other circumstances.  The hearing officer, as the trier of fact, has the authority to weigh the evidence and is not bound by the opinions of experts who testify on the issue of reasonable value, but may believe all or none of the expert’s testimony and may accept it in part or reject it in part.  Beardsley v. Beardsley, 819 S.W.2d 400, 403 (Mo. App. 1991); Curnow v. Sloan, 625 S.W.2d 605, 607 (Mo. 1981); Scanlon v. Kansas City, 28 S.W.2d 84, 95 (Mo. 1930).

DISCUSSION

             In order to prevail, Complainant must present an opinion of value and then present substantial and persuasive evidence tending to demonstrate that his opinion of value is supported by market evidence.  Complainant has failed to meet this burden of proof.  One sale is usually not sufficient to establish market value, especially when it is rebutted by numerous other sales.  The overwhelming evidence suggests that Complainant’s property would sell for at least $70,618 as determined by the assessor and affirmed by the Board of Equalization.

            Complainant asserted that his purpose in appealing his assessment was not so much to change value as to bring to light all of the problems that he thought existed with the county’s mass appraisal system. (Tr. 21).  Upon cross examination, Complainant admitted that he was not familiar with the format of some of the county records, and it appears that some of the perceived errors were a result of this lack of familiarity with county records. (Tr. 26-27).  As painful as it may be, all government agencies should welcome taxpayer scrutiny.  In this instance, it appears that the county’s assessment procedures result in accurate calculations of market value.

ORDER

            The assessed value determined by the Board of Equalization, is AFFIRMED. 

            A party may file with the Commission an application for review of a hearing officer decision within thirty (30) days of the mailing of such decision.  The application shall contain specific detailed grounds upon which it is claimed the decision is erroneous.  Failure to state specific facts or law upon which the appeal is based will result in summary denial.

            If an application for review of a hearing officer decision is made to the Commission, any protested taxes presently in an escrow account in accordance with this appeal shall be held pending the final decision of the Commission.  If no application for review is received by the Commission within thirty (30) days, this decision and order is deemed final and the Collector of Platte County as well as the collectors of all affected political subdivisions therein, shall disburse the protested taxes presently in an escrow account in accord with the decision on the underlying assessment in this appeal.  If any protested taxes have been disbursed pursuant to Section 139.031(8), RSMo, either party may apply to the circuit court having jurisdiction of the cause for disposition of the protested taxes held by the taxing authority.

            Any Finding of Fact which is a Conclusion of Law or Decision shall be so deemed.  Any Decision which is a Finding of Fact or Conclusion of Law shall be so deemed.

            SO ORDERED June 21, 2006.

STATE TAX COMMISSION OF MISSOURI

 

 

 

_____________________________________

Luann Johnson

Senior Hearing Officer

 

 

 

 

Certificate of Service

 

I hereby certify that a copy of the foregoing has been mailed postage prepaid this 21st  day of June, 2006, to:   William Maurer, P.O. Box 322, Kansas City, MO 64195, Complainant; John Shank, 9800 N.W. Polo, Suite 100, Kansas City, MO 64153, Attorney for Respondent; Lisa Pope, Assessor; 415 Third Street, P.O. Box 20, Platte City, MO 64079; Sandra Krohne, Clerk, 415 Third, P.O. Box 30, Platte City, MO 64079; Donna Nash, Collector; 409 Third, P.O. Box 40, Platte City, MO 64079.

 

 

 

_______________________________

Barbara Heller

Legal Coordinator